Tuesday, July 31, 2007

Public relations firm Weber Shandwick Worldwide gives a list of tenchallenges to doing business in China. In summary they are:

* Customer loyalty/retention—there is a constant influx of new brands,increasing competition* Cultural sensitivities—westerners do not usually have extensiveknowledge of local cultural and governmental customs* Discrepancy between government policies and economic growth—recenteconomic growth is rapid and the government is not adapting policiesat the same rate.*Intellectual property—China has an extensive counterfeit industry,making protecting assets difficult* Innovation/creativity—Historically the Chinese people have not beenencouraged, or even allowed, to think for themselves or think “outsidethe box”* Employee loyalty/commitment—employees switch jobs frequently to “get ahead”* Building networks and alliances—“Guanxi” (relations) are the key todoing business in China. Building trust takes a long time.* Lack of talented managers and appreciation of “brain power”—manymanagers have not been afforded the opportunity to studyinternationally or gain international experience* Flexibility and adaptability to change—company structure has gonefrom state to private, and domestic to internationally so rapidly thatit has been difficult to adapt sufficiently* Wide geographical, cultural, and personal income disparities—Chinais such a large country with varied markets that universal marketingis a near impossibility

JAPAN

Besides the obvious challenges from a language standpoint, there aremany subtleties of Japanese culture that permeate their businessstyle.

DO:* Bow slightly when introduced or leaving a meeting.* Study a person’s name card/business card carefully, and ask agentle, thoughtful question.* Follow up with a thank you fax, email, or letter.* Be introduced through a trusted customer, client, employer, etc.* Provide a dinner meeting at some point.

DON’T:* Be late.* Toss business cards across a table or write on them.* Press too hard for a commitment or be too aggressive when closing a deal.* Chew gum during a meeting (probably a no-no here, too!).

Business differences in Japan are also addressed in the subsequentlecture slide. Some of the highlights are:

* Decisions tend to take longer, along a prescribed step-by-step process. * More consensus is typically sought in Japan because of the highnumber of people and business entities involved in transactions.* Patience is very important.* There is stronger loyalty, so companies do not change businesspartners or vendors/suppliers very often.* Business in Japan is often organized in large conglomerates withmany “family companies,” so it can be difficult to become a “qualifiedvendor.” The process can take one year or more.* If you do not have an established presence in Japan it is easy to bepassed over as a new business partner.* Contracts can take up to a year to be negotiated.* Payment terms tend to be longer.

* Japan is group-oriented with emphasis on harmony (“Wa”).* Consensus matters a lot.* According to a Japanese proverb: "The nail that sticks up getspounded down". Don’t stick out.* "Honne and Tate Mae." The former is one’s true feelings and thelatter refers to a façade. In other words, people often hide theirtrue emotions in order to save face.

INDIA

India has become a major player in international business, especiallywith recent discussion of outsourcing and offshore business ventures.

* India is a versatile and diverse country. Do your research.* Don’t judge India based on tourists’ impressions.* Communicate carefully, as a premium is placed on this.* Never squirm.* Never shake hands, touch, or sit close or next to a woman.* Keep a respectable distance between a man and a woman, especially in public.* Indians often want to know everything at the first meeting. Don’t be offended.* A foreigner’s value may be equated with the money that can beobtained from him or her.* The more you want something, behave as if you don’t care if you don’t get it.

BRAZIL

Brazil is often listed as one of the world’s leading emerging markets.It is a country rich in culture, demanding that businesses obtain agreater understanding to forge successful relationships. There is anice fact sheet available from Window on the World, Inc. Some of thehighlights include:

* The People: warm and friendly, lively, free-spirited* Meeting and Greeting: take time to greet and say good-bye to each person present* Body Language: physical contact is part of simple communication; do not shy away* Corporate Culture: don’t get right to business; face-to-face contactis the most important; facts are not always accurate initially asBrazilians expect a certain amount of “hype” during negotiations* Dining and Entertainment: always dine in a prestigious restaurant;allow plenty of time for meals (2 hours or more)* Dress: Brazilian women dress “sexy” for all occasions; foreign womenwanting to blend in should avoid looking too formal or “stiff”; menshould wear a dark business suit, white shirt, and a tie* Gifts: they are not important in establishing businessrelationships, so people do not expect them at first; an expensivegift may be viewed as a bribe.

MEXICO

With its proximity to the United States, and its impact on immigrationand local business, Mexico is an important country to understand whenconsidering the global economy from the U.S. perspective.

* Women should initiate handshakes with men.* Mexican men may exchange a type of bear hug, called an “abrazo.”* Handshakes at the end of a meeting usually affirm what was discussedor agreed to.* Conversations occur at a much closer physical distance than in theU.S. Moving away to maintain “personal space” is consideredunfriendly.* Eye contact should be infrequent.* Men should avoid putting their hands in their pockets in public.* Putting your hands on your hips signifies a challenge.